Petronas eyes RI's retail oil, gas sector

Muninggar Sri Saraswati, The Jakarta Post, Jakarta

Aiming to tap into the country's already liberalized downstream oil and gas sector, Malaysia's oil and gas giant Petronas will set up soon a number of gasoline stations focusing on selling high quality non-subsidized fuel and jet fuel avtur.

The first depot will be built in Tangerang by early next year at the latest, according to Malaysian Ambassador to Indonesia Zainal Abidin Zain.

"Petronas will enter (Indonesia's market) by year-end or early next year," Zainal said after visiting Aksa Mahmud, the deputy speaker of the People's Consultative Assembly (MPR) as well as the founder of Bosowa group.

Aksa confirmed Petronas' intention, saying it will "set up its gasoline station business extensively in the country."

"Petronas will set up gasoline stations as well as avtur (jet fuel) stations in airports."

He did not say whether Bosowa would become Petronas' Indonesian partner.

Indonesia has now opened up its downstream oil and gas sector to boost competition within the sector formerly controlled by state oil and gas firm PT Pertamina.

Aksa said a gasoline depot was now being constructed in Tangerang, to serve Greater Jakarta's market.

Aside from selling high quality fuel, Petronas would also set up advanced stations storing and selling jet fuel in a number of major airports in the country.

"The company has secured approval from the related ministry to develop underground avtur storage depots in airports in Makassar (South Sulawasi), Denpasar (Bali) and Surabaya (East Java) so that they could pump avtur directly from its storage to the planes' tank," he said.

Tangerang's Soekarno-Hatta airport is also on the list.

Such direct refueling system would, Aksa claimed, minimize irregularities.

"The digitalized system would reduce cases such as that involving Batavia Air," he said.

Batavia Air filed a complaint with the transportation ministry alleging that the jet fuel pumped into one of its aircraft at Makassar, was found to have been mixed with water after refueling.

Pertamina has denied any wrongdoing and an investigation into the case is now underway.

Petronas plans to expand its upstream and downstream businesses in Indonesia by investing US$100 million this year.

At present, Petronas produces about 20,000 barrels per day of oil and 2,000 tons of liquefied natural gas from its eight concessions in Indonesia.